Tuesday, January 15, 2008

PM correction underway

What started as a promising gain in gold fizzled by noon. PM stocks never got off the ground. One can even argue that this correction was foreshadowed by the continual but controlled decline throughout yesterday. I closed out all positions in my trading account and am waiting for a better entry. FWIW, my Elliott wave count shows that we just finished wave (1) of iii of 3 of III.

Normally, one would expect a correction back to the range of wave (iv) which is around the 50% retracement of 430. The 50 dma will also be in that neighborhood in one week. However,I won't be surprised if we spike a little lower given its recent behavior.